Pharmacists, Manufacturers Rip PBM Practices

Drugmakers join the chorus of blaming pharmacy benefit managers for high product costs and limited access.

As policymakers and consumer advocates continue to demand reductions in prescription drug prices, manufacturers are aligning themselves with pharmacists and providers to blame high drug costs and limited patient access to managers Pharmaceutical Benefits (PBM). The charges range from using formularies to limit the use of important but expensive drugs, to requiring lengthy procedures for patients to get coverage for expensive treatments. Additionally, generic drug and biosimilar makers claim that PBMs encourage consumers to use more expensive brand name drugs that are more cost-effective for plans, even though these tactics harm competition and undermine efforts to develop drugs. less expensive drugs.1 New legislation from leading senators aims to address those concerns, as the Federal Trade Commission (FTC) prepares to launch a broader investigation into PBM practices.

With Democrats now in control of the FTC’s agenda, the Commission sought feedback from stakeholders on how the growth of exclusions from the PBM formulary may limit patient access to drugs.2 The top three PBMs – CVS Caremark, Cigna/Express Scripts, and UnitedHealth/OptumRx – manage about 80% of drug plans offered by insurers and health plans and raise concerns among policymakers that excessive market concentration allows intermediaries to control drug coverage and reimbursement. , as noted in the FTC’s request for public comment on this issue.3

Independent pharmacists are leading the charge with a call for attention on how PBMs, working with large pharmacy chains, are reducing reimbursements and driving patients away from smaller pharmacies. The National Community Pharmacists Association (NCPA) has asked the FTC to investigate these activities and bring legal action against PBMs for certain unfair or deceptive marketing practices.

Similarly, major medical groups accuse PBMs of limiting patient access to lifesaving drugs through formulary prioritization practices and coverage policies. The American College of Rheumatology has spoken out in favor of legislation requiring PBMs to pass negotiated savings on to patients, instead of retaining high discounts and fees.4 And the American Hospital Association cites “white bagging” PBM programs that require cancer patients to obtain in-clinic infusion therapy from a separate specialty pharmacy.5

Meanwhile, brand-name manufacturers point to formulary exclusions that drive patients to select drugs from companies offering deep discounts and deep discounts, while limiting coverage for many innovative but expensive therapies. Pharmaceutical Research and Manufacturers of America (PhRMA) cites a recent report from the Xcenda arm of leading drug distributor AmerisourceBergen, which presents data on how major PBM formularies exclude access to more than 1,000 drugs, leaving patients with limited and more expensive treatment options.6 PhRMA further notes that PBMs often exclude access to less expensive insulins in favor of more expensive versions that offer steep discounts to

Members of Congress have proposed a series of measures to limit these programs and other PBMs. The latest comes from the senses. Maria Cantwell (D-Wash) and Chuck Grassley (R-IA), who are co-sponsoring a bill to limit “spread pricing” and other PBM practices that could affect market competition. A key provision of their 2022 Pharmacy Benefit Managers Transparency Act would prevent PBMs from charging health plans and payers more for a drug than they reimburse the pharmacy.8 Additional sections would block staggered pricing and “clawbacks” of payments to pharmacies; require full disclosure by PBM of discounts, costs, prices, fees and other transactions with health plans and payers; and require PBMs to report price or fee differences between unaffiliated and affiliated pharmacies. The measure also requires the FTC to report to Congress on PBM practices and protect whistleblowers from penalties for bringing PBM violations to light.

As chairman of the Senate Commerce Committee, Cantwell previously held a hearing in May on PBM practices and the need for legislation to establish a fairer system for patients to access needed drugs. The Senate Finance Committee, where Sen. Grassley is the ranking Republican, also reviews these issues, as do the relevant House committees. The Biotechnology Innovation Organization (BIO) applauded the Senate measure as well as the FTC’s ongoing efforts to examine the role that PBMs play in the biopharmaceutical market.

Pharmaceutical mergers also come under scrutiny from the FTC and DOJ

In addition, the FTC has scheduled a public meeting to assess the impact of pharmaceutical company mergers on competition, innovation and consumers. The Justice Department’s Antitrust Division will co-host with the FTC a two-day workshop June 14-15 to examine pharma market competition and merger remedies and how those actions affect innovation biopharmaceutical. This meeting was recommended by the Multilateral Pharma Mergers Task Force, formed in March 2021 by the FTC to seek input on the proper competition analysis from Attorneys General and state officials in Canada, the UK and in the European Union. The workshop will be webcast daily at



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